I initiated regular coverage of the biotech industry at Forbes, and wrote many of the early stories on genomics, personalized medicine, and the automation of drug making. I also launched the Arabic edition of Forbes, and oversaw what became highly influential lists in the Middle East, such as the 50 Most Powerful Arab Businesswomen. Qaddafi's daughter really wanted to be on it, and George Bush mentioned the list at the World Economic Forum. In between, I helped my father, a nephrologist, form a start-up that develops software to assist general practitioners in diagnosing patients. It is part of the exciting new field of health information technology, and it is going to shape the way we interact with our doctors.
Follow me on Twitter @ZinaMoukheiber

Can Cloud-Computing Take On The Health Care Establishment?

“I just met the man who will kill me…such a beautiful app! Oh the envy!!” Jonathan Bush generously tweeted, after viewing a demo from a three-year-old upstart called CareCloud. Bush is the chairman and chief executive officer of athenahealth, an electronic health records company with $324 million in revenues (2011). The would-be killer: Albert Santalo, the founder and CEO of CareCloud, which introduced an EHR earlier this year, and has between $8 million and $12 million in revenues.

I ask Bush what he meant by that compliment. He recalibrates it. “I doubt they could win against athenahealth because of our accumulated experience,” he says. But, he adds: “I thought finally, people are entering the cloud!”

Athenahealth, which sells to physician practices, was a pioneer in the use of such technology in health care. The cloud, where information is stored on an external network of servers and accessed via the web, is nothing new in the world of technology. But, in the health care industry it is a very forward concept, especially for large hospitals, where concern over security breaches is paramount, as well as a fast and reliable Internet connection.

One of the most sought-after EHRs is a closed platform that runs on a 44-year-old programming language, requires a huge farm of servers, an army of technicians, and long hours of training. (Doctors hate that last part). Epic Systems makes it for large hospitals and physician groups, and there are no signs of sales slowing down. Last month, Boston-based Partners HealthCare, which encompasses a network of hospitals and physicians, announced it is implementing Epic at a cost between $600 million and $700 million. David Blumenthal described Epic as a “universal EHR system”—perhaps not the best choice of words. He is the Chief Health Information and Innovation Officer at Partners HealthCare. Until last year, he was the National Coordinator for Health Information Technology, where he was responsible for promoting an interoperable health information system—which Epic is not, but cloud could facilitate.

Before ultimately becoming U.S. Chief Technology Officer, athenahealth’s co-founder Todd Park championed cloud-computing as a more affordable option for physician practices. Last month, Forbes ranked athenahealth #4 out of the top 25 fastest growing tech companies.

Cloud-based EHR companies that target small physician practices include eClinicalWorks and Practice Fusion, but perhaps no start-up has staked its existence around cloud technology more than CareCloud. “That’s where the market is going,” says Santalo. He was thrilled by Bush’s comment, and intends to go after athenahealth’s market by positioning himself as a more nimble player, but reserves his contempt to the likes of Epic and Cerner, calling them the “walking dead.” “It’s a fight among dinosaurs,” he says. CareCloud has raised $20 million in a series A round led by Intel Capital, with Norwest Venture Partners.

Ryan Champlin, who is vice president of operations of the physician network at Cook Children’s Healthcare System in Fort Worth, Tex., will be meeting with CareCloud this month. Cook Children’s has 325 doctors in its network. “It’s the newness of CareCloud that attracts my attention,” says Champlin, who is a big believer in the cloud. In 2009, Cook Children’s selected athenahealth over Epic for its doctors’ network, because of concerns over cost and implementation. Its hospital uses Meditech’s legacy system. “The difference is there’s no significant upfront investment with cloud. What I like about athenahealth and CareCloud is if they’re not working for you, you can move on; you don’t have a huge sunken cost,” says Champlin. “The question is: who is going to produce better health for a given dollar? I bet my money it’s cloud. [Epic CEO] Judy [Faulkner] will say it’s crazy, there’s no track record, but stone tablets used to work well too.”

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This is such a spot on article. The single most important point that is just not highlighted enough below

“One of the most sought-after EHRs is a closed platform that runs on a 44-year-old programming language, requires a huge farm of servers, an army of technicians, and long hours of training”

The big guys took old programming and templates and added some new looks and operability and called them EMR/EHR technology. And in the end they do nothing to provide the promised returns in investment, time, efficiency and outcome. This programming is proprietary, refuses to work with other technologies and forces users to write expensive and cumbersome interfaces to use any other programs and systems. It is indeed holding back the development of less expensive more effective communication among not only providers and insurance companies for better health outcomes, but for reducing the cost of delivery of care as well. In essence they are trying to hold on to their piece of the financial pie at the expense of the patient best interest overall.

Technology exists today via cloud based technology that could share personal health records, doctor or hospital health records, payer health records, process claims, manage treatments across multiple providers and hospitals, in easy to use central servers and data bases. Yet you have companies using 44 year lod programming and trying to make it fit the demands of today. If any reform is mandated it should be using the current technology available to reduce cost and improve outcome.

This is such a spot on article. The single most important point that is just not highlighted enough below

“One of the most sought-after EHRs is a closed platform that runs on a 44-year-old programming language, requires a huge farm of servers, an army of technicians, and long hours of training”

The big guys took old programming and templates and added some new looks and operability and called them EMR/EHR technology. And in the end they do nothing to provide the promised returns in investment, time, efficiency and outcome. This programming is proprietary, refuses to work with other technologies and forces users to write expensive and cumbersome interfaces to use any other programs and systems. It is indeed holding back the development of less expensive more effective communication among not only providers and insurance companies for better health outcomes, but for reducing the cost of delivery of care as well. In essence they are trying to hold on to their piece of the financial pie at the expense of the patient best interest overall.

Technology exists today via cloud based technology that could share personal health records, doctor or hospital health records, payer health records, process claims, manage treatments across multiple providers and hospitals, in easy to use central servers and data bases. Yet you have companies using 44 year old programming and trying to make it fit the demands of today. If any reform is mandated it should be using the current technology available to reduce cost and improve outcome.

Dr.Blumenthal described Epic as a “universal EHR system”—perhaps not the best choice of words. He is the chief health information and innovation officer at Partners HealthCare. Until last year, he was the National Coordinator for Health Information Technology, where he was responsible for promoting an interoperable health information system—which Epic is not, but cloud could facilitate.

When in the 21st century does a person as educated as the Dr. reveal that spending upwards of $700m on a non-inter-operable Healthcare IT closed systems is the best decision! The manner which productivity is enhanced and operational expenditure are reduced is Interactive Visibility the 21st century best business practice only provided by the Cloud and most thoroughly by WebActionHero [.com]. Standard Operating Procedures [SOPs] in Healthcare, in particular, closed loop decision making exhibited by Dr. Blumenthal will only exacerbate the 20th century maladies of Healthcare IT [which seemingly remain un-cured still] that can be solved by examining & implementing 21st century best practices and creating a sector that adheres to a “Lessons Learned” protocol of operational excellence. The dinosaurs, evidently do walk amongst us as exhibited by the decisions of an individual,who in all due respect has yet to evolve his stature to become a 21st century thinker and expert on Healthcare IT. Every dollar will be necessary to serve the needs of not only US health consumers but those here in Canada as well. Relying on the old way of doing business is not an option, given the demographic shift in the manner which healthcare will be consumed near, medium and long term. I will state plainly archaic SOPs from the 1980/90′s should be eliminated.

Great to hear about progress in HIT. I expect more stories like this over the next several years. Goliath should just buy David and call it even. Another excitng cloud-based company is called PhyCloud. http://www.phycloud.com/

HCIT offers a ton of extremely difficult challenges which make it a more difficult industry to crack for new services. Even Google, THE cloud computing company, decided to fold up shop and closed Google Health.

While it’s a tough industry, it’s also more ripe for disruption than any other. There are enormous inefficiencies. The Cloud is perfect for EHR delivery. The trends of mobile and consumerization should also push Cloud-based EHR capabilities and adoption forward rapidly. The EHR must be patient-centric, rather than facility/system specific as is usually the case today. We currently pay for duplication of tests and records because providers literally can’t share and it’s often not in their best interest to share. The largest cost is probably our time as we repeat ourselves, sit in waiting rooms, retake tests etc. There is absolutely no transparency around cost – a single surgery will generate dozens of bills from the facility, the doctor, the lab, radiology, the anesthesist, and then they’ll all send additional bills based on their reimbursement from your insurance company, then your insurance company will bill you based on in/out of network, procedure specific billing, etc. We don’t have a health care system. We have a free for all … or I guess “an expensive for all”.

Epic Systems runs on MUMPS (the ancient software you mention) but Cerner runs primarily on Oracle. Might also be worth mentioning that most of Cerner’s new clients are actually hosted by the firm. While not technically Cloud Computing, this SaaS based delivery of services does offer many advantages over on-premises implementations. In many respects, Cerner finds itself in a similar position as Microsoft. Their SaaS architectures are also similar, multi-instance rather than multi-tenant. Protecting the revenues and margins of the past isn’t easy when you have firms like CareCloud and Practice Fusion offering services that cost less and are easier to consume.

Salesforce.com is another firm worth mentioning (also runs on Oracle). Salesforce.com was the first business-centric Cloud Computing company and just happens to own a stake in Practice Fusion.

Cloud Computing will fundamentally transform HCIT, but it’s going to take 10 years to really make a dent.

I might well have chosen Care Cloud as the EMR I will use for my office of 5 physicians and two nurse practitioners but Epic has the market cornered. My hospital uses Epic and the only way that I can have a truly integrated system is by choosing Epic. It isn’t until 2014 that the health care reform act will require interconnectivity (and I doubt that deadline will hold) and I can’t wait that long.

Great article, Zina! At CX, we feel like the healthcare community can greatly benefit from cloud computing, and it’ll be interesting to see the evolution of its influence. And, by the way, we’d LOVE to hear your opinion on CX–we’re a safe and secure cloud storage service that gives users their first 10GB of online storage free. We also have collaborative features, such as groups and chat. We’d love to have you check us out and let us know what you think! http://www.cx.com

Interesting article. I will have to cite this (Google “REC blog” — I’m the first result). One of my REC clients just jumped from an EMR product that was dreadful (both in terms of workflow functionality and support) to CareCloud. They just launched on it this week. We’ll see how well it goes.